tv The Kudlow Report CNBC April 24, 2012 7:00pm-8:00pm EDT
smiling, i am not, the kudlow report is just moments away. all right, we need to find quality companies in this market, quality beating and quality wins, stick around, i'm talking oil patch in larry's show and i don't want you to miss it. where did all of the nee -- neesayer goes? china is off the charts, after of of the knew buyers, this is just getting starting. i'm jim cramer, see you tomorrow, what do you have for us? congress threatening to get rid of 401 k accounts. it boils my blood. this is the kudlow report, another desperate attempt of vote buying by president obama.
he promises ultra low student loan interest rates. the question this evening, how are we going to pay for all of this? and this comes as congress considers unleashing a tax rate on invest ter class 401 ks, there's $18 trillion in cash there and they want their tax paws on it. only consumption should be taxed, this idea is nuts. and then the supreme court will hear arguments on the controversial immigration law in arizona allowing cops to check the status of anyone they stop. it's a failure by the federal government to have their own clear immigration policy that might provide for guest workers and a path this citizen. here is a stunning fact. for the first time since the great depression, more excans
are leaving than coming up. we begin tonight with breaking news. just moments ago, three more secret service employees were forced out in the columbia prostitution scandal that tarnished the image of the secret service agency. one of them stayed at the same hotel where president obama stayed. when senators questioned whether the prostitutes may have been russian spies. that is chuck grassly from iowa. there's 21 prostitutes that we know of, you're suggesting they could be russian spies. >> that was misreported, i'm saying russia did that, it's something you have to be cautious about. in this case i wasn't tieing the
russian statement to what happened in columbia, i'm using that as an example of how other countries may try to get secrets out of us. >> where it's the street service people that made big mistakes, many of them are not around any more, or white house staff involved, we don't know enough about that. does anybody know who these prostitutes are or were or was? >> i believe that they followed through, they had a hard time getting the cooperation of the columbian police, and i don't know to what extent, but they were going to have access to that. now that information that i just said is three or four days old, so i don't know how many of the prostitutes they actually questioned, but that was their intention to run them down and talk to as many as they could. there was a person that took a lie detector test, and he did
not take advantage of the prostitution chance that he had. he didn't want anything to do with it, and the prostitute i was told verified there was no relationship. >> all right, so you're saying the potential for one of the hookers to be a russian spy, you're surmising. you're just saying the old soviets have done this before and you would like to know more about it now is that the idea? >> yeah, but that comes -- that's just a concern that i have raised and everybody else has raised. the extent to which maybe national security could be compromised under these instances as well as the president, maybe not being protected the way he is. never have overriding issues. i'm not sure they're central to this, but it's something that we have to get to the bottom of and make sure that it wasn't. was this an isolated instance of just 10 or 12 secret service
people, and ten or so military people, or the basic culture of the secret service. and i hope it doesn't go beyond these 11, but if it did, then we have a big problem we have to deal with. >> what about, you wrote a let tore the white house chief council, and you want an independent review of the civilians involved, the people on the advanced staff. you want an independent review to be made public, did they respond to your letter? >> they have not responded to the letter yet. i think they're taking the view that the general council makes a investigation we should not question it, and all i can say is we have a president that said he was going to be the most transparent of any administration ever in our history, bottom line of it, this all -- everything they found out, the whole country ought to know about. they ought to be transparent because we're dealing with the protection of the president, we're dealing with national security issues, and that's not something to be played with, and
so i get back to then what i told director sullivan a week ago today when he briefed me the first time. i said when will you involve the inspector generals because i have great confidence because they tend to be very independent of the bureaucracy, and he said they would be involved. it's a natural extension then when the secret service is working with white house advanced white house communication, there is defense department people in white house communication when you go on these trips, then it seems to me they work as a team. it was just within the secret service and the military? or were other people involved? i'm don't have any accusations they were, but i had enough people call me that had worked in previous administrations that said you ought to look into that. so i'm looking into it -- >> do you expect to get any answers? do you expect to get any in the
white house? do you expect to get answers on the prostitutes from the secret service? >> if we have the most transparent administration in m history, i would expect answers. i expect answers because i don't stop until i get answers. >> all right, thank you for coming on the show and updating us, we appreciate it very much. >> all right, thank you. >> another big story, the general election of course in full gear, the president is on a two-day college tour. the theme, prevent interest rate hikes on government student loans. we are joined now with the details on that one. >> good evening, it was a little bit of a flash back to campaign 2008, the president was fired up and ready to go in his speech in north carolina as he goes on this two day tour. he was talking about this issue of student loans and he told the audience at chapel hill that he could relate to the burden that
they're facing, take a listen. >> we only finished paying off our student loans, check this out, all right, i'm the president of the united states -- we only finished paying off our student loans about eight years ago. >> and larry, this is all about courting the youth vote as he makes this college tour and one other stop today about the courting the youth vote as well, stopping by the set of host jimmy fallon where he had this conversation about his relationship with mitt romney. >> do you know mitt romney? >> i have met him, but we're not -- friends. >> so you can bet they will meet again sometime down the line in this campaign season as it gets under way. >> cheeky, not you, but the
president. >> never me. >> never you. let's turn to jared burnsteen, former economist for joe biden, and a former director of the congressional budget office, on the question of the subsidized student loans and keeping the interest rates down, i just want to know, is this entitlement state vote buying? there seems to be no reform, no analysis, just throw it in there between now and the election? >> this is pure applicants, larry. there are big problems out there. we know the under employment and unemployment rate was 50% last year. there's nearly a trillion dollars in student debt, and 39 million loans are out there. this touches a fraction of this, only the loans through the government, subsidized, taken out this year, and no repayment until after graduation, so we're
looking at something that doesn't help anybody now, it helps people at most by about $7 in three or four years, it's pure politics. he is going to campus to campus selling this of great importance when he didn't show up and vote on it. >> it is vote buying, and only those who take out new loans this year, before the election, will get the virtues of this cheap subsidizing. >> the first hint this wasn't just politics came when he just said this is a 2008 campaign issue. in 2009 and 2010, the president implemented a change to lower the interest rate on student loans and to take the middleman, the private banks, which the government was backing their loans, out of the equation, raising about $36 billion in middleman fee that's we were
wasting on private banks put into pell grants. i think you, me, and doung can agree on the following points. we have a college attainment problem in this country. america used to be number one, now we're at the middle of the pact. the college tuition outpaces middle class income. unless the president has taken the actions that he did, a lot of families would be priced out of the market. i very much disagree with your characterization of this as a small program. overtime this will affect many kids who would not be able to access college otherwise. >> we want everybody to go to college, but here is what i don't get, do it as you wish. so many analyst have looked at this government subsidized loan grants, the pell grants, staff ford grants, whatever. they argue that the more the government subsidizes them, the higher college tuition skyrockets making it even more
further away from the possibility that the middle class people, but it's the government trying tuition sky high, and that makes the entitlement worse. -- >> let me go to doug first. >> this is a problem of the democrats creation. four-year pubic university is is up 25% since the president took office. very expensive. this policy was passed in 2007 by democrats. this problem coming up with $6 billion to extend it has been known since it passed. democrats controlled the house, senate, and white house in 2008 and 2009, they didn't do anything about it. the president has never put forward a proposal to pay for that and not increased our debt even more. now he is is maying pure politics with an issue that was their creation, they had a chance to fix it, and it's something driving the college costs, and they want to pretend it came from out of nowhere. >> here is the thing, if you look at the research and there's
good work done on this, you have -- you and dough have a point when it comes to private universities. some of these tuition bumps have fed into those prices. on the public university side, where 7 75% of the students go, you don't see that phenomenon. the price increase that doug talked about has everything to do with states being crunched in the recession, and their budgets getting whacked. what these policies have done, and you can just look at college attendants when you talk about the pell grants and the subsidized loans, they have really helped people go to school, and this is critically important. >> i'm sorry, everybody loves free money, but i think the evidence is inescapable -- >> it's not free. >> come on. >> you have to pay for it. >> it's a loan my friend. >> thank you both, we appreciate the debate, next up, big juicy apple beats all estimates and
could open the door to a rally tomorrow. as always, don't forget whether it's education or otherwise, i still believe free market capitalism is the best fwoog prosperity, we're coming right back. at bank of america, we're lending an in communities across the country. fro omrevi htalielzeping t a neigbrhbooklyn..or.ho financing industries that are creating jobs in boston... providing funding for the expansion of a local business serving a diverse seattle community... and lending to ensure a north texas hospital continues to deliver quality care.
because the more we can do in local neighborhoods and communities, the more we can help make opportunity possible. guys. come here, come here. [ telephone ringing ] i'm calling my old dealership. [ man ] may ford. hi, yeah. do you guys have any crossovers that offer better highway fuel economy than the chevy equinox? no, sorry, sir. we don't. oh, well, that's too bad. [ man ] kyle, is that you? [ laughs ] [ man ] still here, kyle. [ male announcer ] visit your local chevy dealer today. right now, very well qualified lessees can get a 2012 equinox ls for around $229 a month. to provide a better benefits package... oahhh! [ male announcer ] it made a big splash with the employees. [ duck yelling ] [ male announcer ] find out more at... [ duck ] aflac! [ male announcer ] ...forbusiness.com. ♪ ha ha! only hertz gives you a carfirmation. hey, this is challenger.
breaking news, apple beats all earnings estimates and it could spark a big rally tomorrow, let's dive right into it, we have an executive editor from forbes magazine. john, block buster numbers from apple. my first question is why did wall street completely miss that. they have been selling the stock going into these numbers, they were bearish today, and they got bombed out, why? >> i missed it too. this iphone number keeps growing in an amazing way, and this time
at&t were light on the number. think about what tim cook said. he said china is up 3 x year over year. it's more than half as big as the americas region when you get that sort of a market growing, and we can see where tim cook was in china a few weeks ago, he was selling iphones, it's amazing. that's what drove margins and a low demand. >> give me your expert pick on this. in many ways, apple's decline, it was down 10 to 11% in recent days. this will spark the market. all of the geniuses on the street were wrong. were the animal spirits return off this apple news? >> yes, and i think there's a lot of buying left.
it has an enterprise ratio of 11. it's a modest price. >> where did the price close? in trading? >> i don't remember, but i know it was about 9 -- >> we'll get that on the screen. >> i think apple tomorrow could go up another 2 to 3%. >> what does this do to the rest of the market? >> apple has been carrying the market for a long time. the first quarter earnings, it was up 4.8%. without apple the sector was down. apple has been carrying the sector and i expect them to do that tomorrow. >> can they carry the sector and the market? >> i think it's apples and oranges, apple's earnings have -- >> i didn't see that in your notes. >> that's mine. apple's earnings are up 100% year over year.
the s&ps earnings are only up 60%. corporate america is not enjoying the fruits that apple is right now. there's a lot of challenges out there. >> will the market continue to -- is the spring stall in the economy and jobs going to be reflected in a continuing spring stall in stocks? >> i think at the very least we're range bound as opposed to the first quarter when were were a upward sprint. i don't think we can do a lot higher until we get a better sense that europe is on the mend, china is on the mend, that our job market is on the mend. i think that gives investors confidence to bid up, it's a back end loaded year for earnings and people want to feel better -- >> tech earnings so have peat, they're strong, and it's an economically sensitive global sector, why can't that continue? >> tech has done well, ibm raised it's dividend today.
apple is in a class of it's own, apple's revenues more than double micro soft, the profits more than double microsofts. >> i think the problem is is that industrials, financials, and it show positive earnings growth in the first quarter year over year. so to your point about the overall economy and stock market that's right on. i think there will be a massive correction this summer. two years ago, productivity growth in our country was 4%. it's 0.4% now. larry, if the labor participation rate in this country was the same today, it would be 11.3%. >> it's the mother's milk of stocks. profits -- not government policies, not the federal reserve even though the wall street guys give the fed kred. it's all about profits.
if you're right about profits i think you're gloomy about overall profits. that's all i'm saying. michael, if profits outperform, will stocks rise more than folks think? >> absolutely. >> that's it, end on that note, thank you, everybody. coming up, veep stake speculations, romney's choice, romney in high gear, and a very pleasant surprise was floated today. that being kelly ham, a regular here. does she have the right stuff. the do you is up, the nasdaq is down, and the s&p is up. all that before the gang buster earnings of apple.
if you made a list of countries from around the world... ...with the best math scores. ...the united states would be on that list. in 25th place. let's raise academic standards across the nation. let's get back to the head of the class. let's solve this. so i used my citi thank you card to pick up some accessories. a new belt. some nylons. and what girl wouldn't need new shoes? we talked about getting a diamond. but with all the thank you points i've been earning...
♪ ...i flew us to the rock i really had in mind. ♪ [ male announcer ] the citi thank you card. earn points you can use for travel on any airline, with no blackout dates. welcome back to the kudlow report, mitt romney's no comment on a vp short list has stirred it up. you see eight high up on the list that have been campaigning with mitt romney. there is one surprise, kelly ayotte, she's a regular here. so bob costa, i'm floating around, tweeting, twittering, and i see a front page picture
of kelly with an endorsement, she has become big stuff, what do you make of the buzz? >> i have been covering her since she started running for the senate. i'm bullish on her. she has suburban appeal, young family, young kids, military family. gets along with romney, she's a first term senator. she's also from the northeast, does he want to double down on new england in this election? >> what's your favorite? give us the inside pick, who is your favorite right now? >> i think washington experience you need rob portman, a swing state, bush's budget director and ustr, i also like chris christie in new jersey.
>> what about jeb bush? >> he is good, out out of office for a long time, he has an independent persona in florida, but the bush name, a lot of people wonder about the bush name. >> rudy juliany is coming on our show tomorrow, and he thinks that mitt romney should pick a candidate sooner rather than later. don't wait until july and august, pick it early so that person can be road tested and fighting trim for the fall election, sooner or later, what do you think? >> the old school thing is to have surprise around august and the convention, but i think romney is looking at the strategy. if you bring someone out sooner, you get them on the trail, develop a message early in the spring, you are a united team, and you have a strong message against obama. so i think romney is very
meticulous, he make look for a surprise earlier to have that effect. >> i couldn't agree more. copping up, another anti-business attack by organized labor, the nlrb gets clearance now for a ten-day in bush attack on business elections. incredible. union boss will face you have with bob lutz after the break. we'll debate the assault on business on kudlow report. i remember the day my doctor told me i have an irregular heartbeat, and that it put me at 5-times greater risk of a stroke. i was worried. i worried about my wife, and my family. bill has the most common type of atrial fibrillation, or afib. it's not caused by a heart valve problem.
he was taking warfarin, but i've put him on pradaxa instead. in a clinical trial, pradaxa 150 mgs reduced stroke risk 35% more than warfarin without the need for regular blood tests. i sure was glad to hear that. pradaxa can cause serious, sometimes fatal, bleeding. don't take pradaxa if you have abnormal bleeding, and seek immediate medical care for unexpected signs of bleeding, like unusual bruising. pradaxa may increase your bleeding risk if you're 75 or older, have a bleeding condition like stomach ulcers, or take aspirin, nsaids, or bloodthinners, or if you have kidney problems, especially if you take certain medicines. tell your doctor about all medicines you take, any planned medical or dental procedures, and don't stop taking pradaxa without your doctor's approval, as stopping may increase your stroke risk. other side effects include indigestion, stomach pain, upset, or burning. pradaxa is progress. if you have afib not caused by a heart valve problem, ask your doctor if you can reduce your risk of stroke with pradaxa.
welcome back to the kudlow report. in this hour, the nlrb gets the green light today for a ten-day ambush attack forces union elections on businesses. president obama is smiling, i'm not. here is another, congress nooting an idea for an investor tax class rates for 401 k plans. it's a outrage. the country needs more saving and and investment, don't tax it. fail on immigration with no clear immigration policy, arizona state rights will be put to the test, and the controversial immigration law is heard by the supreme court, south carolina attorney general whose law is similar to arizona,
alabama, missouri, texas, and georgia, he will join us to make the state's right case. we begin with the nlrb power graph. that's the national relations labor relations board, they got the green light to allow ambush in the next ten days. i see it as an assault on business. let's talk. cnbc contributor bob lutz, form erp general motors vice chair, and greg judamin, he was an organizer at the afl-cio. welcome to the show. i know we will disagree. but to me, a ten-day election notice makes to sense for business or frankly to educate the very work force that might unionize. >> the thing, the ten days is not really in the statute, it does call for a faster election
and faster elections are needed. you know right now -- it's not like this is brand new to employees. they talk about these things for a long time before they decide to unionize, and once the board rules we'll have an election date, right now businesses have the right to file an appeal after appeal, after appeal, and they go to lawyers who get to review drafts and review all sorts of documents that the delays are endless. this is the smart way to do it and what's fair for employees. they're the ones that want to unionize. it's who we're looking after. >> employees need to have as much information at employers can give them. employees have a lot at stake. the average election time from when it's called to when the vote is, is is 38 days. why do we have to go down toownn days. this puts all of the heat on business. >> well, i think there's other provisions too like the
so-called formation of microunions. i read that in the "washington times" today. i think the whole thing was voted in by a democratic controlled senate. this is a democratic party paying back the unions for their support, and i don't think any of us should be surprised. do we like it? no, is it a good thing? >> no, will america will more competit no. it's a bad thing, i don't think we should be surprised. >> what's -- just tell me, what's a micro union, i'm sorry, what's a micro union? >> apparently, part of the provision that the unions can now have the right to organize small groups of employees within a workforce, and then recognize that small group, and then there is the risk that in the nonright
to work states, other employees can be done for dues even though only a small portion of the workforce is unionized. and frankly, you know, i think that runs counter to individual lipperty, it runs counter to everything we believe in in the private enterprise sector. >> what's your response to that? >> it doesn't make employers less competitive, not at all, corporations around the world are unionized to a largest ex-tent here in the united states. we have company that's are highly unionized and darn competitive. you mentioned before about business vs. to have the ability to weigh in and educate employees. that's nonsense, employees can educate themselves. we don't organize employees, they organize themselves in the unions, they make the decisions. >> in all honesty, i understand your point of view and that we disagree, but shouldn't business be given a chance to put out as
much information as possible? and it covers a lot of ground. you know in recent decades, private unions have shrunk radically. i don't think the unions are popular, and what troubles me about this is they're trying to give unions every advantage to the detriment of the free speech and information. >> they have plenty of time. after an election is called, businesses start the campaign immediately. they have plenty of time to do it now. the national labor relations act that the board is empowered to rule on is completely slanted towards business. employees, especially that want to try to unionizere stalled every step of the way. you're 38 day thing that you mentioned before, that's only the day between when the hearing is adjourned and when the election is called for. that election is delayed constantly. the republicans in congress, the debates on the employee free
choice act kept talking about all they wanted was employees to have the right to vote. to have a secret ball loet election. now they're saying they apparently don't want them to have an election at all. they want to throw it into the courts and legal system -- >> is that true? >> greg is charging that businesses don't want elections at all, what's your take? >> i frankly don't agree with that comment, and i'm sure most business wouldn't either. the fact is many workforces in the united states once they understand the full ramifications of unionization elect not to have a union. the uaw has been significantly unsuccessful in unionizing the japanese and german transplants in the southern states, and they have lower labor cost than the unionized plants in the north. so you can hear the rhetoric all you want, the bottom line is
this is contract party paying the unions back, and trying to foster increased unionization in american industry. that's my bottom line. >> what's happening here is that congress needs to try to level the playing field on behalf of workers. if workers decide they don't want a union that's their right. it's not the law that says the workers got to voice their opinion. despite all of the delays that employers and corporations like to put forward, eventually they came to a vote -- >> i know you're a man of good will and a strong point of view, how do you do ten days? i don't get that. i don't know where you got that from. >> it's all over, it's every single report. >> that would be the minimum under the law, but the law doesn't require that. employers have plenty of time to do that. the employers know about these things, once employees want a
union, they have discussions, employers are aware, they filter their propaganda, they have daily meetings and mailings to people to get them to vote no. >> i think we disagree, but thank you. as always, let's turn back to stocks. baker hughes stocks shot up, jim cramer believes the beat is really a miss for investors, how so? >> larry, you lower earnings estimates enough, you temper expectations enough, you have stocks able to go higher, that's what happened today with baker hughes that reported a sub par number and went higher in price. in some ways they had nowhere to go but up. they hit a 52-week low. i am thrilled that they have been able to rally, but i would rather go with quality here, there are two oil service companies doing well absolutely
and relatively. the deep water is coming along dramatically with a big price increa increase. another delivered a fantastic number, and it is not north american focus, so it doesn't need natural gas to go high tore beat the numbers. i would cycle out and into this one because quality is more important than lowered bars that get beaten because after the rallies, the baker hughes and others are now more exspintive than the two best. that's nuts. make the change. both are owned by my trust. you will not regret it, back to you. >> many thanks, jim. copping up, congress contemplates unleashing a tax rate on the investor class by going after 401 ks, it's lewd
omnipotent of opportunity. you know how to mix business... with business. and you...rent from national. because only national lets you choose any car in the aisle. and go. you can even take a full-size or above. and still pay the mid-size price. i could get used to this. [ male announcer ] yes, you could business pro. yes, you could. go national. go like a pro. yes, you could. how did the nba become the hottest league on the planet?
by building on the cisco intelligent network they're able to serve up live video, and instant replays, creating fans from berlin to beijing. what can we help you build? nice shot kid. the nba around the world built by the only company that could. cisco. investor class under attack again from washington. now congress is considering a tax rate on your 401k and other
retirement accounts. this is dumb. there's one thing this country needs, it's incentives to save and invest more. here now is phil, president of american commitment, as i understand it, what is being discussed is instead of deducting $50,000 a year, they will cut it back to $20,000. that to me is the dumbest thing i have ever heard. what are they thinking about down there? >> well, this is one of these proposals we get from the left that sees money and they think smash and grab job, there's the money let's take it and spend it on big government programs, but you really can't defend this as a matter of tax policy, it's tax reform in reverse. they want to worsen the savings and investment when we should be trying to eliminate it. >> it seems to me that all saving and investment should be tax free. tax consumption, income consumption, why why should we
tax saving and investment, that's what we need to grow the economy, form new business, and create jobs and family income. that's the deal, why tax it at all. >> you're right, we talk about broadening the base. you don't want a base so broad you're double taxes. this is one of the big problems with the tax system now. one of the things that alleviates that is tax advantaged accounts. we should be up and downing them and saying if you save and invest we will not tax that until you earn the income on it. we will tax consumption once and only once. we would have lower cost of capital. we would have more productivity. >> you have roughly 18 some odd trillion worth of these retirement accounts. this is, in effect for democrats and liberals, this is a grab bag. take that money and spend it, or use it for deficit reduction.
you could be sure if you take that money their going to spend it, it will not go to the debt. >> you're right, i'm convinced that any tax hike right now will only fuel more government spending. i think they have to focus on the spending side to get the deficit under control. as you know, we never get more than 18% of g dprks p no matter where we set the tax rates. give the government the same size slice of a smaller pie, and the deficit will keep galloping at $1 trillion a year. >> taxes retirement accounts, a really lousy idea. coming up, arizona controversial immigration law heads to the u.s. supreme court tomorrow. this is a big state's rights issue, and a failure by the federal government to have a clear immigration policy, that's up next. up next.scottrader streaming quotes, any way you want. fully customize it for your trading process -- from thought to trade, on every screen.
and all in real time. which makes it just like having your own trading floor, right at your fingertips. [ rodger ] at scottrade, seven dollar trades are just the start. try our easy-to-use scottrader streaming quotes. it's another reason more investors are saying... [ all ] i'm with scottrade. mcallen, texas. in here, heavy rental equipment in the middle of nowhere, is always headed somewhere. to give it a sense of direction, at&t created a mobile asset solution to protect and track everything. so every piece of equipment knows where it is, how it's doing or where it goes next. ♪ this is the bell on the cat. [ male announcer ] it's a network of possibilities -- helping you do what you do... even better. ♪
arizona is a controversial immigration law head tots u.s. supreme court tomorrow. the obama administration will challenge the law that allows cops to check the immigration status of anybody they stop. pete williams joins us now. >> not just allows but required. arizona says the lisle immigration is hit the hardest with a third of the illegal crossings coming over it's border in the last decade concerns with lax federal enforcement. they passed a new law, and most
controversially, it requires police making arrest or traffic stops to check the status of anybody suspected of being here illegally and to detain them until status is verified. it immediately went to court, the lower court said immigration is a federal responsibility, and agreed with the government that arizona's goal of enforcement is at all costs upsets what should be national priorities. the federal government also says that it's concentrating on the most dangerous illegal immigrants, those that commit crimes or present terrorism, and that arizona would flad the system with anything who fails to have papers. arizona will say that states can pass their own laws on immigration enforcement. >> that word require, is that the key issue in this or is it a
state's right issue? >> it's two questions, what powers do arizona police have under current federal immigration law, arizona argues the current law gives them the right to do this, and secondly the state's rights points, arizona says we're a country of powers reserve to the states, we don't need federal per noise do this. >> thank you, state's rights appear to be at the core of this debate, we're joined now by the president and ceo of president works usa, and a attorney from south carolina. allen, as our own pete williams just suggested, federal law says that immigrants have to have their papers with them, their cards with them. so why shouldn't the states be able to card somebody that they come into contact with with law enforcement, why not? >> the state should be able to do that and that's why we're in court tomorrow. i applaud arizona taking a leadership roll on this issue.
scare is dealing with a similar issue. we firmly believe that it was also noted last year in the whiting case, another case involving employers, employees, and licensing, being used to punitively punish employer who's fail to check legal status through e verify. the supreme court jep held this as a right of the state to regulate this area of law and to augment federal law. >> with all that, i don't see what beef is. if the local cops stop somebody, ask for their drivers license, ask for their insurance card and immigration law. federal law says that's what you can do, what's the issue here? >> the issue for the supreme court is whether state law and federal law conflict. if they conflict, federal law trumps state law. and you're looking at the details, right, and they seem reasonable, but the theory behind the arizona law, is a
theory called attrition through enforcement. they seek to make life so miserable for unauthorized immigrants that they drive them to leave the state. that's not federal policy. looking at the details it my have made sense. >> that's a very key point. attorney general wilson, does the arizona law seek to make life so miserable for arizona illegals they have to leave? >> this is a red herring, we're talking about what is constitutionally provided for. the state has powers reserved urn the 10th amendment. anything prohibited by congress, and the bar is very high for what is prohibited, there is nothing prohibited that allows arizona to allow local law enforcement to supplement or augment and support a federal government that for years ag claimed a lack of resources. we're also dealing with administration debt.
they say we will prohibit law enforcement, and they use the term racial profiling, but we will mandate under the state department, there is a manual called the access manual that requires law enforcement to racial profile for getting people access -- >> that's not what the court will be thinking about. what the court is thinking about is the do these two laws conflict? and arizona will be trying to say they don't, and if you look at the saur face details they don't, but if you look at the big intent, they are hugely. >> i'm a guy, as you well know, i want to see reforms at the federal level. i think you have to have -- i'm all for the security at the border, but there ought to be guest worker reforms, and frankly at some point citizenship should play down the road. but the interesting thing to me,
for the first time since the depression, more mexicans are leaving the united states than are entering the united states. and a lot of this is the lousy economy, in fact, job creation is probably better in mexico right now than the united states, including those walmart stores being attacked, and also border protections and other laws are working. so are we getting closer now? the immigrants are going the other way. >> when the economy picks up, we will need low skilled immigrants again. nobody is building any houses now, people are not eating out, not staying in hotels, when the economy picks up we will continue to news low-skill immigrants and the problem will be that mexico's demographics, people are having fewer babies, and the middle class is growing and the economy is good, we will be worried about where the next immigrants will come from. >> again if i may, i want to say this is really about the most port power of state solvereignt.
are they allowed in the tenth amendment to pass laws. it's great to have policy changes and that the economy is well enough for some of these immigrants to leave, but we're not against them taking some of these jobs. if you want to come to my house, come to the front door and introduce yourself, not the window at 3:00 in the morning. for the states to augment it is in a state's right. >> i don't disagree, but congress has -- it's hard for the states to create guest worker programs and to create a front door. congress needs to create a front door and i believe there is a role for the states to play. >> i think we need federal reforms, but to me this is a flat out state's rights issue, and the local law enforcement should do what they're doing to do, and it doesn't sound like the federal government is against it, i think balm's crowd